MARITIME BUSINESS INSIGHT
Feature
Ship Managem ent
C.Y. Tung International Centre for Maritime Studies Maritime Education Research Consultancy Volume 4, Issue 4, October 2016
INTER-DISCIPLINARY MARITIME PRACTICE WORKSHOP SERIES 2 Inaugural Evening Session – “An Inspiring Odyssey - Offshore Wind Energy” 7:00pm - 9:00pm, Tuesday 29th November 2016 at Room QR305, Hong Kong Polytechnic University The series of nine monthly workshops with a theme of “Inter-disciplinary Maritime Practice” (IMP) is the second of its kind, the first series having been completed in December 2015. It is jointly organized by three institutions in Hong Kong, namely, The Hong Kong Logistics Management Staff Association (HKLMSA), C.Y. Tung International Centre for Maritime Studies, PolyU (ICMS), and the Hong Kong Seamen’s Union (HKSU) with a view to providing a platform for expert professionals from the Hong Kong and regional Maritime Industry to unreservedly share their view and valuable experience with those whose careers and professions are in the shipping fraternity of Greater China Region. The IMP Program was structured to cover the entire life-span of a ship, from the decision to purchase to its final loss or scrapping. The mode of workshops is based upon case-study format, with guest-moderators being invited to share their view and valuable experience, be it good or bitter, in specific issues. Series 1 which began on 9th January 2014 has proven to be a very proactive educational workshop. The Inaugural Session shall start with the case study on Offshore Wind Energy Project and IMP and Inter-disciplinary Learning (IDL) methodology. Parties who are interested can contact Miss Catherine Chow at Tel: 2771-6180 or [email protected] for details. Seats are free-of-charge for staff and students of the Hong Kong Polytechnic University. They should contact Miss Violette Wong of ICMS at [email protected] . Please note that reservation of seats are first-come-first-served.
Topic and dates of the whole series are as follows:- An Inspiring Odyssey - Offshore Wind Energy 29 Nov 2016 Ship Management, Operations, & Technical Maintenance 20 Apr 2017 Financing of Shipping & related Projects 15 Dec 2016 Ship Chartering & Administration, Agency 18 May 2017 Project Management, Shipbuilding & S&P 19 Jan 2017 Marine Insurance (Hull & Machinery, Protection & 22 Jun 2017 Ship Types, Machineries & Equipment 16 Feb 2017 Indemnity) Value of Maritime Professional Services 16 Mar 2017 Disputes & Casualty Management (Legal & Commercial) 20 Jul 2017
MAritime Business Review (MABR) Announcement of New Journal and Call for Papers
Please note that the first issue of Maritime Business Review (MABR) is now published online: http://emeraldinsight.com/loi/mabr The maritime business environment is dynamic and complex. Recently, it faces many new challenges, including ship over capacity, market turmoil, fluctuation of bunker fuel price, security, safety, acquisition and merger, organizational restructure, and environmental sustainability. At the forefront of these multifaceted challenges, Maritime Business Review (MABR) aims to provide the latest research insights and state-of-the-art theory and management practice to maritime researchers and practitioners on all aspects of maritime business. MABR will serve all maritime business disciplines that include, but are not limited to: • Shipping market analysis and forecasting, • Maritime education and training • Customer services and marketing • Human resource management • Organizational behavior in maritime business • Strategic alliance • Innovation management • Intermodal transport operations • Maritime security • Port management and operations • Safety management • Terminal management • Shipping finance • Green ports • Marine insurance • Cruise operations and management • Ship chartering • Shipping sustainability and social responsibility • Bulk shipping • Technology in maritime business • Fleet management • Legal aspects in maritime business
For author guidelines, and paper submission please visit: http://www.emeraldgrouppublishing.com/services/publishing/mabr/authors.htm Editorial Office: C.Y. Tung International Centre for Maritime Studies, The Hong Kong Polytechnic University
Maritime Business Insight Volume 4, Issue 4, Oct 2016
Maritime Business Insight Volume 4, Issue 4, Oct 2016 Contents EDITOR’S MESSAGE 2 Editor-in-chief: Quality Assurance and Safety Management 3 Dr Sik Kwan TAI by Capt. Himanshu CHOPRA Editors Mass Flow Metering – Setting New Standards for Fuel Dr T.L. YIP Measurement 9 Ms Yan Pik YIP by Iain WHITE Editorial Advisor: Interview report with Capt. Li Ming Sang, Patrick of Sinotrans Shipping Ltd. on Ship Management Issues 13 Prof. Chin-Shan LU DISCLAIMER by Vicky YIP Yan Pik All opinions stated in the
Shipping Giant Hanjin Falls into Financial Difficulty: Ships articles are those of the Stranded at Sea 18 respective authors and do not by Vicky YIP Yan Pik necessary reflect the views of the editors or ICMS. Deserted Casino Ship “New Imperial Star” Finally Sold to Pay Seafarers’ Outstanding Wages - Interview with Mr. We hereby express our Jason Lam and Mr. Frederick Lau of Hong Kong Office gratitude to all the authors for (FOC) of the International Transport Workers’ Federation 23 their photographs and articles. by Vicky YIP Yan Pik If you are interested in Feasibility Study of Emission Control Area in HK 27 subscribing an e-alert or you by Bobby CHAN Ka Chun, HUI Yin Tung, TANG Man Yu and have any inquiry about the TSE Pui Ying Maritime Business Insight, please feel free to contact us. The Role of Hong Kong in the “One Belt One Road” Initiative 31 Tel: (852) 3400 3617 by CHEUNG Sze Man, Jasmine, LI Ho Tai, Xavier and TSANG Email: Tsz Wai, Vivian [email protected] Call for Articles for Jan 2017 Issue 35 Website: www.icms.polyu.edu.hk
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EDITOR’S MESSAGE We also reported the case of the casino ship “New Imperial Star”, which had been The feature of this issue is Ship Management, abandoned in the waters of Hong Kong from the core element of operation of a vessel. October 2015 to September 2016, subsequent to We are pleased to have invited Capt. its sale by auction, and now at the waters of Himanshu Chopra of Anglo-Eastern Ship India. A large sum of unpaid wages to seafarers Management. Ltd. to write on the topic of was incurred by the ship which abandonment Quality Assurance and Safety Management also caused the hardship of the crew being for compliance with ISM Code. He highlights trapped onboard the ship. In this issue, MBI had the importance of developing a safety culture, a talk with Mr. Jason Lam and Mr. Frederick goal setting of zero fault and reporting Lau of Hong Kong Office (FOC i.e. Flag of immediately non-conformities. We are also Convenience Campaign) of the International delighted to have Capt. Patrick Li Ming Sang Transport Workers’ Federation to find out why of Sinotrans Shipping Ltd. to talk about the this kind of abandonment happened and how implementation of Concentrated Inspection they provided assistance to the seafarers. Campaign and what his company has done for the entry into force of MLC 2006, including Hong Kong has declared itself as an Emission the development of the MLC 2006 Control Area (ECA) in May 2015 and imposed Management Manual and the Self Checklist. the implementation of the 0.5% Sulphur Capt. Li also talked about the problem in restriction but this is not sufficient to fulfill the managing the crew. future requirement set by MARPOL. A group of students of the Department of Logistics and Bunkering is a part of ship management and Maritime Studies have conducted a feasibility disputes, arising mainly from discrepancy study to identify the limitations and between the amount of fuel that is believed to weaknesses of the current practices and have been bunkered and the amount invoiced, introduced the use of LNG as fuel of vessels. are frequent. Mr. Iain White of ExxonMobil, in his article, introduces the mass flow Lastly, another group of students introduces the metering system (MFMS) for solving this Role of Hong Kong in the “One Belt, One Road” problem. initiative. They illustrate how Hong Kong can act as the third source of financing for the In the sphere of global shipping, the most OBOR initiative because Hong Kong is shocking news must be the collapse of the situated at a favorable geographical location Korea shipping giant, Hanjin Shipping. Many and can act as an international financial centre. Hanjin ships, as well as huge worth of cargo, This is the last issue of the MBI in 2016. We are still stranded on the sea. Meanwhile, wish our readers Merry Christmas in advance. retailers need to secure the space for carriage Our next issue will be published in January of cargo in Hanjin’s vessels for the Christmas 2017 which we wish to be a hopeful year for the shopping season and so there may be a rise in global maritime industry. the freight rate. While other impacts of the collapse have yet to be seen, Hanjin was ordered by the court to sell as many of its own ships as possible. Hanjin’s collapse has led to fear and alert in other global shipping companies of the overcapacity of vessels in the coming months.
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FEATURE Ship Management
Quality Assurance and Safety Management Capt. Himanshu CHOPRA, QHSE Department of Anglo-Eastern Ship Mgmt. Ltd
Capt. Himanshu CHOPRA joined sea in The International Standards Organization 1997 as a Deck Cadet. He has sailed (ISO) defines Management Systems as primarily on gas tankers and follows: attained the rank of Master in 2011. “A management system describes the set of From 2013-2015, he has performed procedures an organisation needs to follow in audits on various types of vessels order to meet its objectives.” managed by Anglo-Eastern Ship Management Over the years, ISO has created innumerable Ltd. standards (more than 19,500) and certification Capt. CHOPRA is presently working as to these standards is an industry in itself for Assistant QHSE Manager with Anglo-Eastern. classification societies and others. Over a Anglo-Eastern presently manages over 600 million companies are certified to ISO ships. standards. There is a similar theme in all standards. They prescribe ‘common sense’ A common question that any professional advice based on the famous Plan-Do–Check- related with Quality Assurance is asked is Act cycle. “What is quality assurance?” The Merriam Webster defines this as a program for the systematic monitoring and evaluation of the Quality Ship Management various aspects of a project, service, or “You say what you do, do facility to ensure that standards of quality what you say and show that are being met. you do what you say.”
Let’s take a look at the two words individually i.e. “quality” and “assurance”. “Quality” would be in relation to delivering goods or In a quality management system, you say service of a high standard and “Assurance” what you do, do what you say and show that would be a guarantee of sorts. Therefore, a you do what you say. The problem arises combination of the two would simply translate when a shipping company’s standards for as a commitment towards consistently safety are not up to the internationally agreed delivering a first class standard. standards, even though the company may have a quality assurance system in place. Quality assurance was initially introduced in World War II when weapons and ammunitions By now, we can collectively agree that it is were inspected and tested for defects after they difficult to see how a ship can provide were made. It started with quality control, and quality service if it is not assured of safety! then evolved into quality assurance and eventually to the present principles of quality management.
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A number of very serious accidents which The ISM Code is intended to improve the occurred during the late 1980's, were safety of international shipping and to reduce manifestly caused by human error, with pollution from ships by impacting on the way management faults also identified as ships are managed and operated. The ISM contributing factors. Lord Justice Sheen in his Code establishes an international standard for inquiry into the loss of the “Herald of Free the safe management and operation of ships Enterprise” famously described the and for the implementation of a safety management failures as "the disease of management system (SMS). sloppiness". In the ISM Code, probably the most important clause is the preamble to para 6: “The cornerstone of good safety management is commitment from the top. In matters of safety and pollution prevention, it is the commitment, competence, attitudes and motivation of all individuals at all levels that determines the end results.”
It is the commitment, competence, attitudes and motivation of all individuals at all levels that determines the end results.
At its 16th Assembly in October 1989, IMO adopted resolution A.647(16), “Guidelines on These two well-crafted sentences are the Management for the Safe Operation of Ships essence of Quality and Safety Management and for Pollution Prevention”. The purpose of Systems and in fact apply to any industry. On these Guidelines was to provide those a practical level, they cover the entire responsible for the operation of ships with a operation of the company. framework for the proper development, implementation and assessment of safety and The devil is in the detail of implementation. A pollution prevention management in number of authors have written about the ISM accordance with good practice. The objective Code, its implementation and how the safety was to ensure safety, to prevent human injury management system should be structured. All or loss of life, and to avoid damage to the the sections or 12 elements (of Part A) of the environment, in particular, the marine Code are usually very well explained by environment, and to property. The Guidelines various writers. However, in my opinion, all were based on general principles and the literature available on the subject is geared objectives so as to promote evolution of sound towards compliance with the requirements of management and operating practices within the Code, thus taking a narrow view of the the industry as a whole. requirements of an effective Safety Management System. After some experience in the use of the Guidelines, in 1993, IMO adopted the The devil is in the detail International Management Code for the Safe of implementation. Operation of Ships and for Pollution Prevention (the ISM Code) and the Code became mandatory in 1998.
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This, therefore, brings into question the appreciate the value of an effective safety possible achievement of self-regulation culture at all levels. The argument as to culture or safety culture if all whether a “Goal Zero” policy is useful, the efforts are towards achievable or even counter-productive rages advising readers and on. practitioners ONLY on compliance. It can be convincingly argued that “Goal Zero” is the ONLY ethical and practical goal to set, The objectives of the ISM as to aspire to anything less implies a Code of continuous negligent, even immoral, acceptance of improvement in safety management should workplace casualties, and that some establish the climate in which a well-trained, “minimum” is a fair sacrifice in pursuit of healthy seafarer can properly adopt a safety productivity. culture necessary to the successful completion of any maritime adventure. “Goal Zero” is the ONLY ethical and practical goal to set. The objectives of the ISM Code should establish a safety culture. A concept of “As Low As Reasonably Practicable” can be more useful in furthering In terms of shipping, a safety culture is a the pursuit of excellence; as it allows for the broad, organization-wide approach to safety effective measurement and management of and quality management. A safety culture is health and safety in a way that does not punish the end result of combined individual and failure or encourage covering-up and under- group efforts toward values, attitudes, goals reporting. By accepting that there will always and proficiency of an organisation’s health be a certain level of unmitigated risk, but then and safety programme. In creating a safety striving to minimise it, better results can be culture, all levels of management are highly achieved than by an ill-managed and regarded on how they act toward workers and unrealistic target. on a day to-day basis. 2. Commitment from the Top Here, in my opinion, are the essential steps to implementing a healthy safety culture and in This is perhaps the most critical area to focus turn an effective safety and quality on. Management should appreciate that management in your organisation: merely obtaining an ISO or an ISM certification does not mean the quality and safety management system becomes static. 1. Identifying Your Organisational Goals It is for this reason that the preamble focuses It is vital to first identify the goals of the on ‘commitment from the top’ as it is hoped organization. To do this, you also have to that the ‘top management’ understands and factor in the customers’ needs as well as the appreciates that commitment to safety and needs of the employees and anyone else who loss prevention cannot be compromised at any uses your services. time. Wavering from it could mean an accident that may cause the end of the There are many shipping companies that set a business and the reputation of the company. If goal of “zero accidents at sea”. This statement, the management systems are working while laudable in intent is worthy of further correctly, quality actually pays for itself, analysis and thought if we are to truly 5
Maritime Business Insight Volume 4, Issue 4, October 2016 usually through a growth of the business and decisions based on information available via an enhanced market reputation. emails, phone calls or conversations. The diverse culture which currently prevails in this 3. Commitment from the Employee industry brings a barrier to communication through cultural difference. The effectiveness of a quality assurance and safety management system depends on how well it permeates in the fabric of the The important thing in organisation—‘the ways in which things are communication is to hear done’—so that a positive safety culture is what isn’t being said. generated and maintained in an ongoing manner.
The procedures, manuals, and checklists only lay down the framework of the expectations. Communication has to be both top–down and It is the seafarer and the office staff who bottom–up which will show commitment decide whether to follow the procedures or not. throughout the whole organisation and Various strategies and programs are required especially the commitment of top to ensure that the commitment from the top management. Open and frank conversations does not get diluted at the sharp end. are needed to encourage a healthy safety culture.
5. Working Conditions It is the seafarer and the office It is the duty of the company to ensure that the staff who decide whether to working conditions are such that the employee follow the procedures manuals, and checklists or not. is in a position to work safely. Sufficient resources of stores, spares and personal protective equipment must be available. It is difficult for employees to believe in the safety objectives of the organisation if they have to 4. Effective Communication work and deal with sub-standard living conditions, machinery or equipment. As per ISM Code clause 6.7 “The Company should ensure that the ship’s personnel are able to communicate effectively in the 6. Reporting Accidents, Near Misses and execution of their duties related to the safety Non-Conformities management system.” With the objective of improving safety and The critical part in pollution prevention, the ISM Code requires effective the company to ensure that the SMS includes communication procedures to investigate and analyse ‘non- especially in the conformities, accidents and hazardous maritime situations’. environment. As Peter Drucker said When a major incident occurs, it is common “The important for considerable time, effort and money to be thing in spent establishing what happened. Following communication is to hear what isn’t being the investigation, when the root causes are said.” This is very much applicable in the ship inferred, it is often realised that these were management where shore managers practise apparent and visible long before the incident virtual management and tend to make occurred. 6
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Reporting such events at an early stage, One can have long periods without accidents followed by appropriate corrective and and 99.9 percent of the employees may be preventive measures, can prevent accidents doing the right thing, but all it requires is for that lead to pollution, damage, injury or loss of one or a few individuals to let their guard life. It is therefore important for the company down for accidents to happen. The and personnel to recognise the importance and anonymous safety culture surveys help to value of reporting non-conformities and identify the weaknesses in the implementation hazardous occurrences and so called ‘near of the systems as perceived by the workforce. misses’. 9. Modifying Behaviour 7. Immediate Actions on Safety Issues The goal of implementing an effective safety culture must be to modify the attitude and It is important to recognise the behaviour of company personnel at every importance and value of level, from senior executives to front-line reporting non-conformities and crew, so that they “believe in safety, think hazardous occurrences and so safety and are committed to safety” not called ‘near misses’. because they fear punishment, or are required to by rules and regulations, but because they want to – as they understand it is in their best interests, financially and morally. Our behaviours depend on our past experiences. This is generally called the “Antecedent Behaviour Consequence” (ABC) It is important that personnel theory. If employees see that safety issues are of every level “believe in promptly and correctly handled by their safety, think safety and are supervisors, they get the confirmation that the committed to safety.” organisation is serious about safety. If safety issues are not handled immediately, the employees will believe that lack of safety is Developing an effective safety culture based “acceptable” and “tolerable” within the on the concept of continuous improvement, organisation. personal commitment and responsibility by all, is a long term process and involves much hard 8. Measuring Performance and Behaviour work and effort.
While the audits and inspections are Some companies may wish to conduct prescribed in the ISM Code, they do not tell ‘behavioural assessment’ programmes, using us the perception of the management systems outside consultants to oversee changes to the in the minds of the work force. The behaviour company’s safety culture. of the individual is based on his intrinsic beliefs, and the safety culture of company. 10. Training and Continuous Development The ‘safety culture’ and ‘organisational culture’ can be measured with the help of Marine industry is dynamic and ever-changing. questionnaires and surveys. These give an The need of the hour is to keep ourselves insight into the ‘unwritten policies’ of the updated with changes affecting our work company and tell us ‘how things really work’ environment, primarily including new in the field. These help to channel the regulations and the latest technology. In thoughts of the stakeholders and to focus the addition, the protection of the environment, attention of decision makers on the reality. concerns about global warming, sustainability and supply chain security all take a central role
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Maritime Business Insight Volume 4, Issue 4, October 2016 so we need to remain aware of new scenarios in each of these areas.
To have a better understanding of the global To -do-List and operational challenges facing us at any one time, we need to develop new skills, 1. Identifying Your Organisational which can be achieved by pursuing Goals professional development initiatives in their various guises. Fulfilling the STCW 2. Commitment from the Top qualification is only the minimum, generic requirement as far as competency skills go. 3. Commitment from the Employee
To be suitably qualified for a type-specific 4. Effective Communication ship, we must also: (a) Have the requisite experience (as required by some stakeholders like oil majors); and (b) 5. Working Conditions Pursue additional qualifications and training (both company and trade specific) to hone our 6. Reporting Accidents, Near Misses knowledge and practical skills. Skills required and Non-Conformities for day-to-day operations should be learnt and developed by the individual, with support 7. Immediate Actions on Safety Issues from well managed companies as appropriate. These skills range from acquiring in-depth 8. Measuring Performance and knowledge about subjects such as commercial Behaviour law and insurance, as well as soft skills, like how to communicate effectively and manage 9. Modifying Behaviour cultural diversity. Acquiring such skills prepares people, not only to manage day-to- 10. Training and Continuous day operational issues, but also to help them Development look to future career progression.
In conclusion, the success or failure of the QHSE Management Systems is based on our understanding and management of the people and the Human Element in particular. An employee who feels valued is one who will do the right thing – even when no one is looking.
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Mass Flow Metering – Setting New Standards for Fuel Measurement Iain WHITE, Global Marine Marketing Manager, ExxonMobil
Iain WHITE has over 35 Measurement uncertainties years’ experience within the marine Another cause of measurement error results from industry, beginning frothed fuel in the receiving tank. Because his career as an traditional techniques measure by depth, a tank Engineer Officer in with froth can overstate the volume of fuel 1979 with the Cunard measured. Steamship Company. During the 12 years While the best intentioned can easily make Iain served at sea, he mistakes, there is a need within the industry to sailed on various address this challenge. The most common vessels developing measurement issue, regularly reported in the experience in both media, is known as the ‘Cappuccino Effect’. This steam and motor propulsion, and gained a is achieved by compressed air being injected into the fuel via the transfer pump or supply hose steam and motor chief engineer’s during the transfer. It can also occur as a result of certificate. the barge having compressed air added into its
tanks to increase the apparent volume of the fuel Mr. WHITE joined ExxonMobil in 1991, during its transfer. working in various global roles including sales and trading, technical support and There are some steps that can be taken to verify business development within the marine the correct quantity: fuels and lubricants department. Check the sounding of the barge tanks before and after bunkering to confirm Bunker Disputes are Frequent the tank quantities.
Bunker disputes are frustrating, time Check the fuel temperature prior to the consuming and largely avoidable. transfer so that the mass can be Unfortunately, they are all too frequent. One of calculated. Temperatures should be the most common causes of fuelling taken at the top, middle and bottom of disagreements is a discrepancy between the the bunker barge tanks, and an average amount of fuel that is believed to have been calculated for each tank. bunkered and the amount invoiced. So what can vessel operators taking on fuel in Hong Kong Check that the density values are do, to ensure they get what they pay for? accurate.
Even the most careful use of traditional manual tank dipping can be subject to error when Ensure the draughts of the bunker barge measuring the quantity of fuel that has been are taken before and after bunkering to delivered on board. Measurements can be compare the change in displacement compromised by changing weather conditions with the quantity of delivered fuel. causing vessel movement, discrepancies in ship/tank geometry and inaccurate tank dips. In However, these measures remain highly addition, complex calculations related to dependent on human diligence and the quality temperature, level and volumetric conversion of measuring equipment and practices. are also susceptible to human error.
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Bunkering Best Practice operators to ensure they get what they pay for when refuelling from a barge. In addition, a port authority or independent-approved third parties can inspect the system and install physical seals. These seals provide unique serial numbers for all critical elements to verify system security and guarantee traceability.
The MFMS uses the Coriolis-effect to constantly monitor and accurately measure the mass, not the volume, while the meters also measure the density and temperature of fuel deliveries. This enables a MFMS to detect any water or air going through it and compensate accordingly.
Additional Benefits
Mass flow metering technology provides multiple benefits for vessel operators, marine Figure 1 Measuring fuel mass directly reduces industry suppliers and regulatory bodies. uncertainty According to an estimate by ExxonMobil, a Fortunately, there is a way to reduce MFMS can save up to three hours per delivery1 uncertainties and increase the integrity and compared with traditional tank dipping. This transparency of the measurement process. This can translate into significant financial and can be achieved by using mass instead of resource savings. volume to measure the amount of fuel dispensed. Changes in fuel temperature and density during the refuelling process can lead to additional The mass flow metering system (MFMS) costs for vessel operators. An estimated offers both the characteristics of an accurate US$3,000 saving could be achieved by measurement system. It can help vessel
Figure 2 Key features of MFMS
1 Comparison versus manual tank dipping.
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Maritime Business Insight Volume 4, Issue 4, October 2016 measuring these variables in real time with a National Technical Reference for Bunker Mass MFMS. Flow Metering in February 2016. A temperature measurement delta of 10°C amounts for up to US$2,100. A 3kg/m density The use of mass flow metering technology has difference amounts for up to US$1,000, and all also been increasing in Hong Kong. Exxon these variables can be avoided by the use of a Mobil introduced the first independently secure MFMS. accredited MFMS in Hong Kong in December 2015, and further expanded its MFMS fleet Additionally, a MFMS can provide vessel with the launch of a second bunker vessel with operators with an automated process, making a MFMS in August 2016. the system easier to use, more transparent and less susceptible to error. Measurement data is Both metering systems are fully accredited by logged throughout the entire delivery process, Lloyd’s Register, in partnership with illustrating the fuel mass transferred at any A*STAR’s National Metrology Centre, the point in time. This offers a transparent and national measurement institute of Singapore, accurate measure of fuel transferred to the and Metcore International, a consultancy with customer’s vessel. expertise in MFMS for bunkering.
To ensure system integrity, the mass flow Mass flow metering technology is setting new metering technology provides independent standards for fuel measurement. While the sealing of the system’s associated pipelines, technology delivers significant value to vessel valves, gauges and barge equipment. operators, it also offers various benefits to fuel Information systems are also secured via a suppliers, regulatory bodies and the port sealed transmitter, with measurement tickets industry as a whole. printed from a secure, designated printer.
In order to ensure that vessel operators gain all of these benefits, it is important that they work with a supplier using an accredited MFMS, certified by a reputable, independent agency. The use of a MFMS that has had all its systems and seals checked and verified by a third party offers vessel operators consistent, accurate and reliable bunkering.
MFMS in Hong Kong
The MFMS has been launched in certain ports, including those of Singapore and Hong Kong. Singapore saw its first commercial bunker delivery using a MFMS in 2012 with an Exxon Mobil-chartered bunker tanker fitted with a Maritime and Port Authority of Singapore (MPA) approved mass flow meter. From January 1, 2017, it will be mandatory to use a MFMS for bunkering in Singapore. The country will be the first in the world to mandate the use of a MFMS. To support the initiative, the MPA has also launched the world's first Figure 3 MFMS
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Figure 4 Security seals help ensure system integrity
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Interview report with Capt. LI Ming Sang, Patrick of Sinotrans Shipping Ltd. on Ship Management Issues Vicky YIP Yan Pik
Capt. LI Ming Sang has 48 years of As shipping is an international industry, a experience in the number of codes, requirements, regulations maritime industry, and laws at the international level shall be including 19 years complied with. In this regard, ship onboard working management comprises the measures to experience which comply with the requirements of port state comprised five years inspection and flag state inspection which as Master Mariner of includes inspection of various aspects. With ocean-going vessels the rapid advancement of technology, and almost 30 years of experience in equipment and improvement of crew welfare shipping companies and as ship surveyors. onboard vessels and the revision of Ship management is of prior importance to international requirements such as those the safe and efficient operation of the sailing of a vessel. A ship management team is employed to provide the shipowner with support throughout the occupancy or charter of the vessel. Some shipowners have their own ship management team while some shipowners assign the management job outside. Ship management can be classified into the following job aspects:-
recruitment, provision, training and management relating to environmental and safety issues, the of crew; job of ship management is continually technical support (dry docking, bunkering, evolving and the management personnel equipment maintenance); should be able to adapt.
quality and safety management – i.e. In this issue, we are pleased to report on our QHSE (Quality, health, safety and interview with Capt. Patrick Li Ming Sang, environment), compliance with all related consultant of Sinotrans Shipping Ltd. Capt. IMO/International/National regulations and conventions, Port State Control and Li’s sharing would surely give our readers an Flag State Control, minimisation of insight into the future development of ship maritime incidents and; management.
purchase of materials and daily supplies for crew.
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Sinotrans Ship Management Ltd. (Sinotrans) Control Officer (PSCO) during every Port has profound experience in the operation of State Control (PSC) inspection during the dry bulk vessels and container vessels. At period of the CIC. After the inspection, a grace period of two weeks to three months is usually granted to the ship to rectify the deficiency or shortcoming and it is expected that the problem is resolved before the ship sails again. In some cases, the situation of the deficiencies will be followed up by the personnel of the Port State of the next port of call. An example of such specific inspection items is the requirement of providing salary and working condition to comply with MLC 2006. present, Sinotrans manages 40 vessels which are all flying the Hong Kong flag. With regard MLC 2006 to ship management, Sinotrans has acquired certification of Safety, Quality and Environment management system (SQE) of MLC 2006, which has consolidated many the classification society American Bureau of previous regulations into one comprehensive Shipping (ABS). set of principles and rights, came into force on 20 August 2013. Shipowners of the ratifying flag states are required to apply for DMLC Part In the interview, Capt. Li focused on the issue I and to compile DMLC Part II for their ships. of the Maritime Labour Convention (MLC) Any ship visiting ratifying flag states may also 2006 and also introduced the concept of the be checked by Port State Control regarding Concentrated Inspection Campaign which is MLC 2006 compliance. implemented by various MoU worldwide including Tokyo Memorandum of China ratified MLC 2006 on 12 Nov 2015, but Understanding. This practice is commonly the convention is not yet in force. As Hong followed in South East Asian countries. Lastly, Kong is under the sovereignty of China, ships Capt. Li discusses various problems arising flying the Hong Kong flag are required to from crew management. apply for DMLC Part I and to compile DMLC Part II for their ships. Concentrated Inspection Campaign MLC 2006 requires the ship to keep onboard 1) Capt. Li introduced the concept of the Maritime Labour Certificate and 2) the Concentrated Inspection Campaign (“CIC”) as Declaration of Maritime Labour Compliance one focusing on a specific area during a period (DMLC). The Maritime Labour Certificate is of normally ninety (90) days. The areas which to certify that the ship meets the requirements require CIC to be carried out are usually those of the MLC, 2006 and the seafarer’s working and living conditions meet the related where high levels of deficiency have been requirements. encountered or where new convention requirements have recently entered into force. The DMLC comprises Part I and Part II. Capt. Li said that the Company announces the item of deficiency on which CIC will be Part 1 of DMLC conducted usually more than two months before the actual inspection work is carried out. The Port Authority of the flag state i.e. Hong As a common practice, questionnaires about Kong will issue Part 1 of DMLC to each the deficiency are distributed to the Port State applicable Hong Kong ship stating the 14
Maritime Business Insight Volume 4, Issue 4, October 2016 requirements as specified in the Merchant On-board recreational facilities Shipping (Seafarers) (Maritime Labour Convention) Regulation that a Hong Kong Food and catering ship is to be inspected to all of the requirements of the Convention. At the end of Health and Safety and accident prevention this part, there is the signature / stamp chop of the authorised person of the shipping company. On-board medical care
Part 2 of DMLC On-board Complaint Procedure Payment of wages Shipowners are required to draw up DMLC Part II to set out the adopted measures for Regarding the section on “Food and ongoing compliance with Hong Kong Catering”, the text in the Management Manual requirements between inspections. For certain is developed from the relevant Title (Title 3 - DMLC issues (e.g. health and safety) that have Accommodation, recreational facilities, food been implemented under the international safety management (ISM) system, shipowners and catering), regulation (Regulation 3.2 – can save the duplication of documents by Food and catering), standard (Standard A3.2 – referring these issues directly to the shipboard Food and catering) and guideline (Guideline ISM manual which is prepared in the shipboard B3.2 – Food and catering) which are printed working languages (e.g. English and Chinese). on pp.51 to 53 of the original text of MLC 2006. An excerpt of the relevant text which is Capt. Li noted that the Company had developed presented in an action orientated style, listing the DMLC part II – Maritime Labour the party responsible and the action required, Convention – 2006 Management Manual is as follows:- which is less than 30 pages and is to some extent an abridged version of the MLC 2006 (which contains 112 pages) and which changes “SINOTRANS provides food and the text into a paragraph form manual. This drinking water supplies for its states what the master, the crew and the shipping company should do in different seafarers free of charge, having due situations. Through the manual, all parties can regard to the number of crew on board, conveniently get to know what actions they their religious requirements and should take. In this Management Manual, the cultural practices as they pertain to requirements listed in the MLC 2006 are food, and the duration and nature of classified into the following 14 topics:- the voyage; and tasks the Master with ensuring that these are suitable in
Minimum age respect of quantity, nutritional value, quality and variety. It is recommended Medical certification that the Cook be provided with a Book of suitable recipes, and that Daily Qualifications of seafarers Menus are prepared in consultation Seafarers’ employment agreements with the Master and crew representatives, and records of this Recruitment and Deployment maintained for easy reference”
Hours of work or rest
Manning levels for the ship “The ship’s cook shall have completed an approved training course, which Accommodation covers practical cookery, food and 15
Maritime Business Insight Volume 4, Issue 4, October 2016 personal hygiene, food storage, stock Capt. Li also remarked that contradictions control and environmental protection might arise between the requirement of security and catering health and safety. and that of safety. He quoted the example of the Anyone processing food in the galley occurrence of fire in the engine room. In this shall be trained or instructed in areas case, the crew should take fire-fighting action including food and personal hygiene to put the fire out as soon as possible. For safety and emergency reasons, there should be a as well as handling and storage of food wooden box containing the key to the engine on board ship. Catering staff shall be room. On the contrary, the key to the engine properly trained and instructed for room should not be put in the wooden box as their positions”. this can prevent unauthorised persons from Apart from the Management Manual, getting to it.
Sinotrans has developed an MLC2006
Implementation Self-Checklist. This part is presented in checklist form and is in both
English and Chinese. The excerpt of the part on Food and Catering is as follows:-
1. Food and catering 食品与膳食服务 (Reg.3.2) Check Following inspections shall be carried out at least once every week: 至少每周检查一次 1. supplies of food and drinking water; 食品和饮用水供应. 2. all spaces and equipment used for the storageCO2 discharge and handling alarm in Engineof food Room 1 and drinking water; 用于储存和处理食物和饮用水的所有场所 和设备. 3. galley and other equipment for the preparation and service of meals; 用于准备和供应餐食的厨房或其他设备. 4. the chief cook shall prepare the weekly menu and placed it in the mess room; 大厨需准备每周菜谱，并放置在餐厅. 5. results were recorded in the “Official Log Book” and the “Deck Log Book”. 检查结果记录在船旗国日志和航海日志. Excerpt of Sinotrans' MLC 2006 Implementation Self-Checklist
By putting “” and “” in the appropriate boxes, the ship’s crew can know instantly which part of MLC 2006 is/are not complied with and follow-up / remedial action can be taken as early as possible.
Talking about the impact of MLC 2006 on the operation of a ship, Capt. Li said, “It is somewhat difficult for a shipping company to comply with the regulation on seafarers’ minimum hours of rest when the ship enters a river. The work of river-steaming requires the CO2 discharge alarm in Engine Room crew to have a watchful eye and so some seafarers may need to work for more than ten hours consecutively and this is in non- compliance with MLC 2006.”
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Maritime Business Insight Volume 4, Issue 4, October 2016
Problems in Crew Management having frequent and close communication with them”, said Capt. Li. “Also, we have enhanced Capt. Li went on to talk about the difficulties our training, in particular training for master encountered in recruitment and employment of mariners, and are at the same time organising seafarers. He told us that Sinotrans has been refresher training courses more frequently to employing mainly PRC seafarers i.e. 85% to ensure a high level of safety. 90% and a small proportion from India and Bangladesh to work onboard its ships. The crewing department recruits these PRC seafarers through its crewing agency stationed in China and around 150 seafarers are recruited annually. The officers employed by Sinotrans have acquired adequate proficiency in English so there is no communication problem onboard even when the crew is a mixed team with PRC, Indian and Bangladesh seafarers.
Lastly, Capt. Li highlighted that Sinotrans has a competitive advantage in the PRC as it is under the China Merchants Group, which enjoys a superior status in the PRC. He also expressed his hope for a revival of the global maritime industry, though he was not too optimistic about this. Meanwhile, Sinotrans will always strive hard to keep up the performance of its crew and the Company as a whole. Capt. Li remarked that the Company nevertheless faced the problems of 1) low level of crew’s alertness and awareness of safety issues, 2) low level of sense of belonging to the Company and 3) high expectation towards promotion opportunities, while having inadequate practical experience.
“In the old days, it was common for a cadet to take 13 to 14 years to be promoted to the post of Master Mariner. Nowadays, however, it is not unusual for a cadet to step into the post of Master Mariner in only eight or nine years’ time,” said Capt. Li. He added that a shortage of seafarers was the main reason for the short period of time for promotion of seafarers. The disparity between the experience required of Master Mariners and what experience they actually had was a worrying issue to the ship management team. “As the onshore personnel of the company, the ship management team is keeping close control of the crew onboard by 17
Maritime Business Insight Volume 4, Issue 4, October 2016
Shipping Giant Hanjin Falls into Financial Difficulty: Ships Stranded at Sea Vicky YIP Yan Pik
The collapse of Hanjin Shipping Co. (Hanjin), ships to other ocean freight operators or air a major South Korean freight company and the freighters. In consequence, freight rates are on world's seventh-largest shipping company, led the rise, at least in the coming months. to about $14 billion worth of goods being stranded at sea and a consequent rise in freight As of 21 September, 2016, the problem of the costs which have been at a low level for the past confinement of merchandise has not been few decades. The collapse has highlighted the resolved. According to the Wall Street Journal, difficulties of the maritime industry as it Hanjin is working on a restructuring plan. If endures its worst downturn in more than 30 this is approved by the court, it will be able to years. keep a maximum of 15 of its 37 owned ships and return to the owners almost all of its 60 Hanjin filed for bankruptcy protection in the chartered vessels. The South Korean Court will courts of South Korea and the USA in late decide in December whether to accept the August this year to protect its vessels from restructuring. being seized by creditors after its main creditor, the Korean Development Bank, declined to As Hanjin owes a debt of about 6 trillion won continue to provide funding for the company. (4.1 billion pounds) and if the South Korean Prior to the filing, the Hanjin ships set off as government is unwilling to rescue the company, normal with their cargoes. After the filing of it will be hard for Hanjin to survive. the bankruptcy protection, all the ships of Hanjin have become “ghost ships”. According Top priority debts means claims for public to reports, as of mid-Sept, around 90 Hanjin interests, which are paid first to creditors and ships in 26 countries have been out of service include damages to cargo owners and unpaid and billions of euros worth of merchandise is charter fees. Outstanding charter fees owed by confined at sea. Hanjin after the court receivership began on August 31 have topped 40 Billion won. In addition, cargo owners could make claims for damages for late or no delivery at all of the merchandise.
Hanjin has a total of 141 vessels, including 97 container ships as of early September. Out of the 97 container ships, 60 are chartered and 37 are owned by Hanjin. Under the order of the South Korean Court, Hanjin has begun returning chartered ships to their owners and is trying to secure enough funds to help unload the cargoes which are still on the ships around the world. The South Korean Court has also Meanwhile, as the Christmas shopping season ordered Hanjin to sell as many of its own ships is coming, retailers need to secure space for as possible. carriage of cargo in Hanjin’s vessels. . There has been much more demand for carriage than there is supply. Companies have been looking for carriers to shift their goods from Hanjin 18
Maritime Business Insight Volume 4, Issue 4, October 2016
Figure 1 shows that as of 30 September, 2016, Hanjin ranks as the 13th, in terms of capacity in Figure 3 China (Export) TEU terms, of existing and order-book vessels Containerized Freight Index 740 (CCFI) which is equivalent to 2.2% of the capacity of 736.07 the top 100 operators of the global liner fleet. 735 730 Meanwhile, as the Christmas shopping season 725 is coming, retailers need to secure space for 720 carriage of cargo in Hanjin’s vessels. . There 715 has been much more demand for carriage than 710 711.28 711.55 there is supply. Companies have been looking 705 705.21 for carriers to shift their goods from Hanjin 702.65 ships to other ocean freight operators or air 700 freighters. In consequence, freight rates are on 695 694.59 the rise, at least in the coming months. 690 19 Aug 26 Aug 2 Sep 9 Sep 14 Sep 23 Sep 16 16 16 16 16 16
Data source: Shanghai Shipping Exchange (http://en.sse.net.cn/eninfo/MarketReport/)
Regarding the situation of Hong Kong, the Hong Kong International Terminals Limited (HIT) set up a team to help retrieve containers affected by the collapse of Hanjin and as of 15 September, more than 1,200 containers, have already been retrieved. Some forwarders and shippers believed that HIT had been charging them high fees and deposits for getting the cargoes back. Nevertheless, Mr. Simon Lee, a As there are fears that Hanjin will not be able financial analyst of the Hong Kong Standard, to pay docking fees and handling charges or was of the view that HIT had handled the their cargos might be seized by creditors, a matter in a fair way as they had helped the number of ports in the US, Asia and Europe forwarders and shippers save time required for have refused to allow Hanjin ships to dock and receivership proceedings. Meanwhile, HIT unload the cargoes. had protected itself from great loss as port operators did not have any priority in making claims in cases of receivership of bankrupted As a brief summary from news sources, the fate companies. of the Hanjin ships is as follows:- Impact of the Collapse of Hanjin 1) Being seized when they berth at ports; As discussed before, it is expected that the 2) Being turned away from ports (Japan, collapse of Hanjin, which is one of the leading China, Germany, Australia, and the US), operators of liners in the world, will lead to a for fear that Hanjin will not be able to rise in freight costs. As some cargoes were pay docking fees and handling charges detained and the carrying capacity dropped or their cargoes might be seized by drastically, the freight rate of global container creditors. As a result, they are still ships rose, as evidenced by the rising trend of sailing on the high seas. the China (Export) Containerized Freight Index
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Maritime Business Insight Volume 4, Issue 4, October 2016
Figure 1 Operated Fleets of Top Operators as at 30 September 2016 % Share of existing % Share of Total = Owned + Existing = Order capacity ships Chartered = Total minus Rank Operator book over that chartered-in existing + order Order Book (TEU) of liner over total book (TEU) fleet in existing ships (TEU) TEU terms 1 APM-Maersk 2,819,586 377,140 15.40% 44.90% 3,196,726 Mediterranean Shg 13.40% 62.10% 2 Co 2,423,832 362,807 2,786,639 3 CMA CGM Group 1,943,296 235,624 10.50% 55.40% 2,178,920 COSCO Container 7.5% 70.10% 4 Lines 988,536 560,888 1,549,424 5 Evergreen Line 624,714 352,848 4.7% 43.90% 977,562 6 Hapag-Lloyd 879,739 52,500 4.5% 45.70% 932,239 7 Hamburg Süd Group 567,486 30,400 2.9% 51.10% 597,886 8 OOCL 449,670 126,600 2.8% 28.70% 576,270 Yang Ming Marine 2.8% 64.40% 9 Transport Corp. 473,237 98,396 571,723 10 UASC 514,694 29,986 2.6% 23.00% 544,680 11 MOL 394,458 120,900 2.5% 70.60% 515,358 12 NYK Line 340,539 168,182 2.5% 47.40% 508,721 13 Hanjin Shipping 453,570 0 2.2% 39.60% 453,570 Total of Top 100 Operators 12,873,357 2,911,675 39.30% 19,214,684 Data source : Alphaliner
Figure 2 Operated Fleets of Top Operators as at 30 September 2016
APM-Maersk 2,819,586 377,140
Mediterranean Shg Co 2,423,832 362,807
CMA CGM Group 1,943,296 235,624
COSCO Container Lines 988,536 560,888
Evergreen Line 624,714 352,848
Hapag-Lloyd 879,739 52,500
Hamburg Süd Group 567,486 30,400
OOCL 449,670 126,600
Yang Ming Marine Transport Corp. 473,237 98,396
UASC 514,694 29,986
MOL 394,458 120,900
NYK Line 340,539 168,182
Hanjin Shipping 453,570
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000TEU
Existing = Total minus Order Book Order book
Data source: Alphaliner
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Maritime Business Insight Volume 4, Issue 4, October 2016 on 2 September, 2016 (CCFI) and afterwards been dropping in the past nine years. It is (Fig. 3). Prior to 2 September, 2016, the CCFI, expected that the collapse of September will which tracks spot and contractual rates for all have an impact on this rate. Meanwhile, Figure Chinese container ports, had been dropping for 5 shows the change of Average TC Duration of a certain period of time. the baby Panamax which has been showing a downward trend since 2010. It is also expected Apart from the freight rate, the containership that the collapse of Hanjin will have an impact charter market was also impacted by the on this duration. Hanjin case. As shown in Figure 1, as of 30 September, 2016, 39.6% (which is a fairly Apart from the impact on freight rate and time large proportion) of Hanjin's fleet were charter rate, it is speculated that the collapse of chartered in. According to Alphaliner’s latest Hanjin will lead to a reshuffling or re- idle fleet update, a number of 24 vessels organization of the existing global shipping operated by Hanjin, were added to the alliance. Hanjin formed a global shipping redundant pool as of 19 September 2016 and alliance with Hapag-Lloyd, “K” Line, Mitsui many more vessels of Hanjin would join the O.S.K. Lines, Nippon Yusen Kaisha and Yang idle fleet once they had unloaded their cargoes. Ming in May, 2016. The alliance covers all Figure 4 shows the Hamburg Index (HAX) of East-West trade lanes, namely, Asia-Europe / Containership Mediterranean, Asia-North America West Coast, Asia-North America East Coast, Time-Charter rates of a baby Panamax over the Transatlantic and Asia-Middle East/Persian period from 2009 to August, 2016 which has Gulf/Red Sea and was intended to last for five
Figure 4 Average TC hire for Containership 20,000
18,000
16,000 2,551-3,099 TEUx14t hom (baby Panamax) max 32.25m beam - 3 months or more 14,000
12,000
TC Hire [USD 10,000 per day]
8,000
6,000
4,000
2,000
0 2009 2010 2011 2012 2013 2014 2015 2016
Data source : Hamburg Shipbrokers Association (http://www.vhss.de/fileadmin/user_upload/hax/HAX_2016August.pdf)
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Maritime Business Insight Volume 4, Issue 4, October 2016 years. The alliance had been operating for less References than four months when Hanjin, one of the partners, collapsed. The collapse will probably “Hanjin Aims to Sell More Than Half Its make some participants re-think and assess Ships”, Wall Street Journal on 16 Sept 2016, Retrieved from Figure 5 Average http://www.wsj.com/articles/hanjin- TC duration for Containership aims-to-sell-more-than-half-its-ships- 16 1474042056 2,551-3,099 TEUx14t hom 14 (baby Panamax) “Hanjin bankruptcy boosts global freight 12 max 32.25m beam - 3 months rates”, Deutsche Welle on 13.09.2016, 10 or more Average Retrieved from Time 8 Charter http://www.dw.com/en/hanjin- [months] 6 bankruptcy-boosts-global-freight-rates/a- 19547088 4
2 “Hanjin Collapse May Spur Shipping Consolidation, Hapag-Lloyd CEO 0 Says”, Bloomberg, on 14 September 2016. Retrieved from Data source : Hamburg Shipbrokers Association http://gcaptain.com/hanjin-collapse-may- (http://www.vhss.de/fileadmin/user_upload/hax/HA X_2016August.pdf spur-shipping-consolidation-hapag- lloyd-ceo-says/ whether it might not be better to team up or re- decide which company to team up with. In “Hanjin payment defaults add to charter addition, the failing of ems to have indicated, rate misery in a depressed sector”, the to some extent, that strategic alliance has failed Loadstar, on 29 Sept 2016, Retrieved to solve the problem of overcapacity of vessels. from http://theloadstar.co.uk/hanjin- payment-defaults-add-charter-rate- Root Problem of Hanjin’s Financial misery-depressed-sector/ Difficulties Simon Lee (2016), “Thankful to dodge the According to Mr. Howard Winn, a former Hanjin crisis” The Standard on 23 columnist of the South China Morning Post, September 2016 the root problem for most market players in the maritime industry is that the capacity currently outweighs the demand. He is also of the view Winn, Howard (2016), “Hanjin bankruptcy: that Hanjin has made matters worse for itself as How low interest rates are brewing a it sold off much of its fleet after 2008 and shipping crisis worse than the 1980s”, chartered vessels instead. The rates of these South China Morning Post, on 9 Sept charters are considerably higher (by 30 to 50 2016, Retrieved from per cent) than the current market rates. As the http://www.scmp.com/week- global economy declines, demand for asia/business/article/2017963/hanjin- commodities and thus carriage service is also bankruptcy-how-low-interest-rates-are- declining, while capacity is on the increase. brewing-shipping This could lead to a significant decline in rates.
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Maritime Business Insight Volume 4, Issue 4, October 2016
Deserted Casino Ship “New Imperial Star” Finally Sold to Pay Seafarers’ Outstanding Wages - Interview with Mr. Jason Lam and Mr. Frederick Lau of Hong Kong Office (FOC) of the International Transport Workers’ Federation Vicky YIP Yan Pik
Ship Abandoned and airless. Besides this, the food was on the point of running out. One can imagine how hard It was not uncommon in the past for seafarers it was for the crew to be kept in these conditions to be abandoned at sea by shipowners facing for months on end. financial difficulties. In October 2015, a team of crew comprising Myanmese, Ukrainian and Chinese seafarers with a Ukrainian Captain were abandoned on a cruise ship stranded in Victoria Harbour. The ship was abandoned by the charterers who operated the ship as a casino but then fell into financial difficulties. All the seafarers were owed wages and had to remain on the ship. They sought help from the Hong Kong office of the International Transport Workers’ Federation (ITF). With the assistance of the union staff, some of the seafarers went back home in June 2016 and received advance payments. The Maritime Mr. Jason LAM (left 1) and Mr. YU Sak Ming (right 1) visited the ship Business Insight (MBI) is pleased to have and talked with the Ukrainian Master (left 2) conducted an interview with the union staff of the ITF who provided the stranded seafarers with help and care. These men had been living in very bad conditions onboard the deserted ship.
Mr. Jason Lam and Mr. Federick Lau, the Inspector and Assistant Head respectively of the Hong Kong Office (FOC i.e. Flag of Convenience Campaign) of the ITF, an international union founded in the UK in 1896, helped the deserted seafarers both financially and with legal proceedings. They were aided by Mr. Ting Kam Yuen, Head of the Office and Mr. Yu Sak Ming, former Inspector of the ITF Mr. Jason LAM (middle) and Mr. Frederick LAU (left 1) assisted the crew of in Hong Kong. the New Imperial Star (left 2).
Mr. Lam told the MBI that the ITF received an email requesting help in October 2015 and so visited the ship which was moored at the eastern In February 2016, the problem of failing the Victoria Harbour, near Kai Tak Cruise Terminal. Port State Inspection was still unsolved. In A barge was made available to those crew mid-April, the seafarers applied for legal aid members who wanted to go onshore. As the services from the Legal Aid Department to ship had been abandoned, the cabins were dirty 23
Maritime Business Insight Volume 4, Issue 4, October 2016 claim their unpaid wages from the casino from China and Hong Kong with no prior operator. experience in shipping. Ship Detained by HK Marine Dept On 5th May 2016, the ship was detained by the Marine Department of HKSAR. According to the Admiralty Law of Hong Kong, once the ship is arrested, the owner will be given one to two weeks to settle the unpaid wages .Otherwise the ship will be sold and the proceeds will be used to pay the crew. However, the wages remained outstanding as the owner had no intention to pay them. Meanwhile, the staff of Sun Junhao, the The deserted crew came to the Mariners’ Club with Mr. operator of the gambling business on the ship, Frederick LAU (right 8) to say thanks. filed a case to the Hong Kong Labour Tribunal. The labour tribunal, however, has no jurisdiction over the BVI-registered company Arising International and so the claim for unpaid wages was in vain.
During the two-week detention, the Mariners’ Club situated at Tsimshatsui, a branch of the Mission to Seafarers, an international missionary organisation, which offers help to global seafarers, visited the seafarers and took them food. Some of the crew flied back to their home country on 15 June Cause of Abandonment of Ship – 2016 after receiving advance payments from seafarers’ organization in Hong Kong. Mr. Jason LAM saw them off. Crackdown on Gambling?
Mr Lau reported that according to the crew, the problems of safety, which led to them failing the inspection, could have been addressed if Ship Sold for Payment of Wages they had been given money for maintenance. The reason why the owner abandoned the ship As the owner defaulted paying the wages after was that the main target customers of the casino it was arrested, on 23 August 2016, the ship was ship were Chinese Mainlanders. When the put on auction of sale and sold to an Chinese Government launched a crackdown on undisclosed buyer at US$1.46 million. The gambling. It led to a drop in their profits. Mr. notice of sale was published in two local Lau continued, “In consequence of the meagre newspapers on 6 September 2016. The 13 revenue, the shipping company simply remaining seafarers (Ukrainians) went back abandoned the ship to avoid paying any more home. They will only get the full unpaid of the outstanding costs.” amounts, ranging from US$1,300 to US$6,500 per month and totalling $500,000, in November The crew reported that there were only around 2016 as the High Court needs two months to 30 customers on the last voyage in August 2015. decide the priority of the claims. Meanwhile, it was found that behind Arising International was a pool of individual investors 24
Maritime Business Insight Volume 4, Issue 4, October 2016
Information of Abandonment of M.V. New Imperial Star at a Glance
The vessel arrived at Hong Kong in August 2015 and operated as a casino ship earning revenue. Cash-strapped Sun Junhao abandoned the vessel after it failed the Port State Control safety inspection by Hong Kong marine officers in October 2015.
Age and Flag of the ship 36 years old, Palau
Deadweight and Measuring 12,586 tonnes, 129 by 21 meters
Registered ship owner Arising International, registered in British Virgin Islands
Price of sale to former owner in 2012 More than HK$100 million
Carrying capacity 513 passengers
Total unpaid wages US$564,000 (accrued since Oct 2015)
Date of sale by auction 23 August 2016
No. of crew members who had been 46 crew members including 20 from Ukraine, 18 from Myanmar & 8 from defaulted wages mainland China
Charterer of the vessel as a casino ship Sun Junhao Ltd. in HK / Crewing Manager -
Rent as a casino ship HK$2 million per month
Selling price (by auction) US$1.46 million
Timeline of Events of M.V. New Imperial Star
Stranded in Hong Kong after it failed the Port State Control inspection by Hong Kong marine officers 6 October 2015 Initially there were more than 100 seafarers/staff working onboard the ship, including dealers (荷官). Some of the Chinese staff amongst them were paid their wages and sent home.
The seafarers applied for legal aid services from the Legal Aid Department to seek their unpaid wages from the casino Mid April 2016 operator.
5 May 2016 The ship was detained by the Marine Department of HKSAR.
33 seafarers were repatriated to their home countries. Each received advance payments capped at US$4,000 from 15 June 2016 loans offered by various parties. Total of advanced payments = about HK$700,000, loaned by The Mariners Club of Hong Kong, the Merchant Navy Officers’ Guild – Hong Kong and Amalgamated Union of Seafarers, Hong Kong.
13 Ukrainian crew remain on board to maintain operations.
12 July 2016 HK High Court ruled the vessel be auctioned to settle the debts of the owner, including crew wages.
The ship was sold to an undisclosed buyer for US$1.46 million. The notice of sale was published in two local newspapers on 6 September, 2016. 23 August 2016 13 remaining seafarers (Ukrainians) returned home. They will get the full unpaid amounts, ranging from US$1,300 to US$6,500 per month, in November 2016, the earliest.
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Maritime Business Insight Volume 4, Issue 4, October 2016
The Hong Kong ITF (FOC) Campaign Office Abandoned Casino Ship in Hong Kong— M.V. Oriental Dragon (東方神龍) The Hong Kong ITF (FOC) Campaign Office which was the major organization to provide In November 2012, around 250 crew help to the seafarers in this case, was set up in members of the Panamanian-flagged 2010. The objective of this office, which is one cruise ship “Oriental Dragon”, sought of the ITF’s offices of Flag of Convenience help from Hong Kong Seamen’s Union Campaign worldwide, is to ensure that when they were owed wages for more than seafarers serving on flag of convenience ships, four months, which was the amount of time whatever their nationality, receive a decent that their cruise ship was berthed in Hong minimum wage and good conditions on board. Kong waters. The shipping agent, which was owed around US$2 million in agency It handles about 150 dispute cases every year. The cases are mainly disputes over wages of fees, filed in the High Court of Hong Kong seafarers of ships under China ownership flying for arrest of the ship. the Hong Kong flag or ships under the The representatives of the crew applied for ownership of China or Hong Kong registered in legal aid in the Legal Aid Department. The FOC countries. Usually the Office receives representative of the owner of Oriental email messages from the seafarers seeking help Dragon turned up, but requested that the and then the staff contact the concerned crew members withdraw the filing for the shipping companies to have a better arrest of the ship. The crew members were understanding of the situation. They then act as of the opinion that this request was not the middlemen between the seafarers and reasonable and so refused to withdraw the shipping companies. In some cases, legal proceedings will be initiated in emergency filing. The shipowner had no other resort cases. but to pay the outstanding wages to the crew members and at the same time asked Besides handling labour disputes, the staff of the crew members to sign an agreement to the Office perform the routine work of give up their right the transportation inspection onboard vessels berthing at Kwai expenses for repatriation and damages for Chung Container Terminal or moored at violation of the employment contract. anchorage twice every week. Mr. Jason Lam is Although these contract terms were often accompanied by Mr. Federick Lau to unreasonable, the crew members signed inspect the payroll of the seafarers to see the contract as they were eager to return whether the wages level comply with ITF to their home town with the back pay. standard. Mr Lam said, “We find this inspection work meaningful as we are ensuring the seafarers are not exploited by the employers. In some cases, we have been successful in helping the families of deceased seafarers to get death compensation. On occasion, this had been delayed by P&I Clubs which refused to recognize the death certificate issued by certain countries as valid.”
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Maritime Business Insight Volume 4, Issue 4, October 2016
Feasibility Study of Emission Control Area in Hong Kong Bobby CHAN Ka Chun, HUI Yin Tung, TANG Man Yu and TSE Pui Ying
May 2015, the Secretary for Transport and Housing declared the implementation of ECA in Hong Kong during the Global Port Research Alliance Conference (Transport and Housing Bureau, 2015). The new regulations became compulsory by law on 1 July 2015. This meant that Hong Kong became the first region in Asia to take a step forward to prepare itself to become an ECA.
CHAN Ka Chun, HUI Yin Tung, TANG Man Yu However, the 0.5% Sulphur restriction is still and TSE Pui Ying were students of the not sufficient to fulfill the future requirement, as MARPOL requires that on and after 1 Bachelor of Business Administration in January 2020, the fuel oil Sulphur limit within International Shipping and Transport ECA shall be under 0.1% in established ECA. Logistics the Hong Kong PolyU. This paper There is still a gap between the current is a summary of their Capstone Project requirement in Hong Kong and the IMO under the supervision of Dr Venus LUN. requirement in 2020. Therefore, a feasibility An Emission Control Area (ECA) has been study is being conducted to identify the proposed by the International Maritime limitations and weaknesses of the current Organization (IMO) on the International practices in emission reduction. Possible Convention on the Prevention of Pollution solutions will be proposed in order to improve from Ships (MARPOL) which came into force the current practices and narrow the gap on 19 May 2005. The current ECAs in the between the two requirements. world include North Sea, Baltic Sea, North America and United States Caribbean Sea (Carr and Corbett, 2015, p.9584-9591). POTENTIAL PROBLEMS Commercial Barriers To comply with the regulation, distillate fuel can be used to reduce Sulphur emission. However, the price of distillate fuel is much
In 2013, the Hong Kong government launched a voluntary low sulphur fuel switching campaign and started to promote low sulphur emission practices by incentivising the participating shipping firms based on the 3- year incentive scheme. After two years, in
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Maritime Business Insight Volume 4, Issue 4, October 2016 higher than that of heavy fuel oil. Using Insufficient Alternative Fuels scrubbers can remove SOx from the exhaust gas, but some vessels may need to be One of the ways to reduce emissions at berth is retrofitted and the retrofitting will cost around to use onshore power supply at ports. The $3-5 million per vessel (Intertanko, 2012). system has been developed mainly in the ports Therefore, both the use of distillate fuel and in North America and Europe. However, there scrubbers require additional costs. is no onshore power supply system in Hong Kong and so vessels at berth cannot get power Difficulties in Raising Funds support from onshore. This may hinder the development of ECA in Hong Kong. It is difficult even for the government to raise funds and thus initiate such a big investment for modifying, upgrading and greening the port and the port infrastructure to serve as an Focus only on Sulphur Restriction ECA. There is no reason why private consortia In Hong Kong, the fuel restrictions only focus should take the risk of such a large investment. on the reduction in Sulphur emission; other In Hong Kong, the ports are operated by emissions such as NOx are not controlled private sectors and this is different from other under the regulation. In order to reduce air government operated ports, like the Port of pollution and health hazards caused by Singapore. Thus, such an investment would emission from ships, Hong Kong should become a business investment and require a establish a more comprehensive regulatory substantial return. However, as investments scheme on controlling the emission in addition including additional bunkering facilities and to MARPOL Annex VI. other related hardware are long-term, it is difficult for private sectors to make such an investment decision.
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Non-internationalized Incentives In order to encourage the use of LNG, the Program government can give incentives in terms of tax exemption to the ships using LNG. Besides, As the new regulation on Sulphur restriction in Hong Kong government can construct LNG Hong Kong will increase the operating cost of bunkering facilities to enhance the LNG the shipping companies, an effective incentive operation. program is essential to motivate shipping companies to comply with the new regulation. However, the cost reduction in port facilities Alternative Sources of Energy and light dues offered by the Port Facilities and Light Dues Incentive Scheme for OGVs, only 1 LNG PowerPac covers the ports in Hong Kong. For the vessels that do not use the port of Hong Kong regularly, The LNG PowerPac can be introduced as an the scheme is not internationalized and may electricity supply station in Hong Kong port as not be a very effective motivator. a short-term alternative to an onshore power supply system. The system requires the containership to load and connect the LNG- powered electricity generator, for up to 30 Negligence and Difficulties in hours’ power, to the ship. The consumption of Determining Compliance power in containership is from 1-3 MW It is the shipmaster’s responsibility to keep (Becker Marine Systems, 2016). The size is records in a logbook when a fuel oil similar to two 40 ft.-HQ, which is applicable changeover operation is completed before to all containership facilities. entering into Hong Kong or commenced after leaving Hong Kong. However, staff of the Environmental Protection Department usually 2 LNG Hybrid Barge rely on the record of Sulphur content provided LNG Hybrid Barge is an alternative to in the bunker delivery note to determine onshore power supply. The barge acts as an whether the vessels have complied with the electricity plant to provide power to the regulation. Although there is random berthed ships through plugging the wire. It inspection of relevant documents and samples will be located near the vessel and provide the of fuel are taken, there are still some cases of power plug to the vessel at port. The barge non-compliance. Negligence of compliance uses LNG as fuel and has low emission checking may hinder the effect of the new of NO , SO and CO (Becker Marine regulation. 2 2 2 Systems, 2016).
The Port of Rotterdam will deploy the barge RECOMMENDATIONS and plans to generate electricity for moored cruise ships from 2017 (Kotug, 2015). Promoting the use of LNG Technically speaking, the barge can be LNG produces less emission than heavy fuel applied to the containership as the voltage of oil. LNG is not explosive even though it stores the cruise ship (10-12 MV) is higher than that a huge amount of energy (Chevron of the containership (2-8 MV) while at the Corporation, 2016). Therefore, LNG is safe to quayside (Port Of Gothenburg, 2010). transport in large amounts across long distances, and is more economical and environmental friendly.
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3 Onshore Power Supply better than IMO requirements to calculate the score. In the case of Hong Kong, the onshore power plug can be installed in all of the 24 berths to provide cold ironing for ships. According to Wang, Mao, and Rutherford, (2015), the 5 Establishment of Monitoring Station investment for OPS will be around RMB $5 Ambient Sulphur dioxide monitors are capable million per berth. The power of the onshore of measuring and monitoring the SO2 emission power supply will come from the local power by vessels within a range of 0.5 km. (Kattner plant that is different from the above 2 et al, 2010). The monitors should be used with alternatives. an automatic identification system to collect In terms of mobility, the PowerPac and LNG the basic information, like the ship type, Hybrid Barge can provide more flexible position, course and speed, of passing ships. operations than OPS. The PowerPac can be This kind of monitoring station can help ports transported to the ships through a quayside to monitor the performance in air emission of crane to provide electricity to the ships and vessels in a more convenient and reliable way. LNG Hybrid Barge can berth near the vessels to supply power. In terms of fuel type, the PowerPac and LNG Hybrid Barge use of LNG CONCLUSION gives a lower emission than the fuel used in the Maritime activities significantly pollute the power plant in Hong Kong. In terms of fuel environment which results in different stability, the OPS will provide a more stable environmental issues. The new regulation with source of power as LNG supply may be stricter Sulphur emission limits in Hong Kong affected by the transportation of fuel. is a milestone of improving air quality. The 4 International Incentive Programme alternatives can be used for closing the loopholes of the current practice with The International Incentive Programme should be introduced to move a step forward to fulfilling the regulations. The current incentive programme of Hong Kong is only applied locally. Hence, to go further, Hong Kong can adopt the unified and international incentive programme such as “Environmental Ship Index Programme” (ESI). ESI is being adopted by many western countries including the United States, Spain, Germany and Norway (World Port Climate Initiative, 2016). Those ports which adopted reference to the practices of other countries. ESI will endeavor to achieve Tier III NOx One example of this is that the use of HFO levels, modification on vessels’ engines or prior to ship departure may need to be change in fuel type is needed. For instance, forbidden. Tier III NOx regulations have already gone into force for North American ECA. A All in all, Hong Kong is stepping forward to discount on port dues will be applied to the becoming a 0.1% ECA in 2020. However, the ships that meet the requirements and have a execution and regulation of the policy may good score. The programme will measure the seem somewhat superficial and Hong Kong Sulphur and nitrogen oxide emission that do still has a long way to go before achieving its goal.
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The Role of Hong Kong in the “One Belt One Road” Initiative
CHEUNG Sze Man, Jasmine, LI Ho Tai, Xavier and TSANG Tsz Wai, Vivian
There is enough capital in Hong Kong to support different financial investments. In addition, Hong Kong continues to promote the renminbi (RMB) offshore business. It acts as a platform to facilitate the global trade and enhance RMB business among those countries. Furthermore, different sectors of Hong Kong have the intention to participate in the OBOR initiative. The government will establish a Belt Group photo with Prof Metaparti Prakash (left 2), and Road Office and committee to coordinate project supervisor the policies and the strategies.
CHEUNG Sze Man, Jasmine, LI Ho Tai, Xavier 1. Evaluate the investment needs of Hong Kong investors and TSANG Tsz Wai, Vivian were students of 1.1 Hong Kong investors are risk-takers the Bachelor of Business Administration in Hong Kong investors have been found to be International Shipping and Transport risk-takers. As shown in State Street, one- Logistics of the Hong Kong PolyU. This fourth of the investors are willing to take a risk for a higher return and this figure is more than paper is a summary of their Capstone that in the Asia-Pacific region and globally. Project under the supervision of Prof Also, they tend to invest in risky financial instruments, such as callable derivative Metaparti PRAKASH. warrants, which take up a higher percentage than other financial instruments. As the Introduction projects in OBOR involve many countries, they are more risky because of the possibilities of The One Belt One Road (OBOR) initiative was changes in international relations. However, introduced by the Chinese President Mr. Xi since Hong Kong investors are willing to take Jinping in 2013. The ‘Belt’ stands for The Silk a risk, they are more likely to invest in OBOR Road Economic Belt, which connects China projects. with Europe, the Middle East, the Indian 1.2 Hong Kong investors prefer to invest in Ocean, Southeast Asia and South Asia. The local, Asian and Chinese markets ‘Road’ refers to the 21st Century Maritime Silk Road which links China with Europe and the According to the Hong Kong Investment Funds South Pacific Ocean. The OBOR initiative Association, the assets managed in the Asian requires a huge amount of capital for regions occupy three-fourths that of the total investment in infrastructure projects and there amount. It shows that Hong Kong investors put are two current sources of financing in China, most of their investment in the Asian region. including The Silk Road Fund and the Asian Also, it is observed that they mainly invest in Infrastructure Investment Bank (AIIB). Hong equities and bonds in this region. Thus, Kong can be the third source of financing for investment opportunities provided by Asian the OBOR initiative because Hong Kong is countries, such as China, India and Indonesia, situated at a favorable geographical location can attract Hong Kong investors because they and can act as an international financial centre. prefer to invest there.
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2.2 Political relations with China Hong Kong is the largest RMB offshore hub Having huge amounts of RMB holdings allows Hong Kong to support the fundraising activities under the OBOR initiative. Also, it is shown that the deposit and exchange quota for RMB in Hong Kong is far greater than in the other three hubs. Therefore, Hong Kong is able to support the fundraising for projects in OBOR, which requires a large amount of RMB for trading.
Connection of stock between Hong Kong and 2. The competitive advantages of Hong Mainland China Kong over Singapore The Shanghai-Hong Kong Stock and Shenzhen- Hong Kong Stock allow more quotas for Hong 2.1 Stock market Kong investors to buy stock in these two markets. It provides a channel for people to Stock market size invest in Mainland China through Hong Kong. The size of the market is reflected by market Thus, it facilitates the investment between capitalisation. The market size has been larger Hong Kong and China. in Hong Kong than in Singapore in the past 5 years. This is because the market capitalisation in Hong Kong is more than 3,000 billion while 2.3 Currency stability that in Singapore is only around 640 billion. Thus, equity financing is easier in Hong Kong The volatility of the HKD relating to the CNY than in Singapore. has been lower than that of the SGD in the past three years, which means that the HKD is more Liquidity of market stable with the CNY. However, the volatility regarding the INR and the IDR is similar for the The turnover ratio of domestic share in Hong HKD and the SGD. Thus, raising funds to Kong is as much as double that in Singapore. invest in OBOR projects through Hong Kong is The higher turnover ratio indicates the better more stable in terms of currency stability. performance of the liquidity of market.
Ability of initial public offering (IPO) fund raising Hong Kong’s ability in fund raising is higher than that of Singapore. The amount of IPO indicates the capital raising ability of the market. In 2015, the number of newly listed companies in Hong Kong is as much as 10 times that in Singapore. It is evident from the above that Hong Kong provides an excellent platform for capital raising.
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2.4 Location accessibility to China merchandise exports, China has outperformed in terms of imports. Furthermore, to measure Hong Kong is located in a favorable position to the container port potential, the coefficient of access China. The total direct flight frequency trade to container traffic has to be calculated, per week from China to Hong Kong is triple which is the responsiveness of the container that of flights to Singapore. Also, the direct traffic due to the change in 1 million trades. flight duration from China to Hong Kong is The result shows that India has the greatest around 3 hours to Hong Kong but it takes responsiveness of trade to container. double that time to fly to Singapore. It is observed that Hong Kong has more a convenient geographical connection with China. As for the overall location accessibility of The GDP growth rate OBOR countries, over 70% of Hong Kong These four countries are promising in terms of overall air passengers are from the member GDP growth rate, especially China. Another countries of OBOR. This indicates that Hong calculation to measure the container port Kong maintains the international status of potential is the coefficient of container traffic aviation-hub. Because of its convenient to GDP, which is the responsiveness of the geographical location, Hong Kong is the container traffic due to the change in 1 million preferred and most convenient choice. This GDP. The result reveals that India has the may be the reason why only few respondents greatest responsiveness of GDP to container. choose Japan or Singapore to raise capital. Therefore, it is better to invest in India and China due to a higher return and a foreseeable 3. Options generated and evaluation of upward trend. options Among 60 member countries of OBOR, a 3.2 Returns from railway majority of people would like to invest in As for the revenue per passenger, it is indicated China projects. It can be seen that China has that the railway in China could contribute a great potential for investment. People would greater revenue than Singapore. However, with also like to invest in Indian and Indonesian regard to the revenue per ton of cargo, the projects besides projects in China. As for the Indian railway may generate more than 10 types of investment projects, nearly half of the times that in China. Thus, it is shown that India respondents would like to invest in the projects has a better performance in generating profits of infrastructure development. Amongst the from transporting cargoes than passengers. infrastructure projects, investing in railway Compared with the total revenue, the Indian and ports is more preferable. Hence, the railway could generate around RMB 1,200 railway projects in China and India, and the billion while that in China generates port projects in China, India, Indonesia and approximately RMB 450 billion. Thus, it is Malaysia are the potential markets for predicted that investing in an Indian railway investors. The project which could generate project should earn a higher return. higher return would be deemed the better project. 3.1 Port return 4. Conclusion The amount of merchandise imports and The OBOR initiative is a long term plan exports integrating the economic and political strategies. Considering the role of Hong Kong, Compared with India, Malaysia and Indonesia, it has great potential to be the third source of the amount of merchandise exports shows that financing and investing in the OBOR initiative. China has greatly outperformed the other This result is concluded by the objective of countries. Similar to the amount of 33
Maritime Business Insight Volume 4, Issue 4, October 2016 investigating the relationship between investment (FDI) restrictions. The FDI quota investment needs of Hong Kong investors, is around 10% to 30% in China (CCB competitive advantage of Hong Kong, and International, 2015). India has loosened its evaluation of investment opportunities offered FDI restriction to 70% or even 100% in some by the OBOR initiative. The study provides industries such as defense and the civil evidence showing that most Hong Kong aviation sector (Goenka, 2016). It can be seen investors have the intention to invest in OBOR that the FDI restrictions in China are stricter projects It also shows that Hong Kong is more than in India. Foreign investors may lose their competitive than Singapore in terms of capital power of control and suffer losses if they raising ability, and that Indian railway projects invest in China. It may reduce the and Chinese and Indian port projects provide attractiveness of investing in China. Moreover, the greater return to investors. the political risk should also be taken into account especially for infrastructure investment because it involves huge capital 5. Recommendations and thus higher risks. 5.1 Role of Hong Kong Based on the data collection and result analysis, 5.3 Government support it is suggested that Hong Kong should focus on To boost the development of the OBOR financing services, especially regarding direct initiative, the Hong Kong government can investment in China’s and India's ports and provide support to it by giving information to Indian railways due to the better return. the corporations such as economic status and However, there are political conflicts between political status in OBOR countries so as to raise China and India. It is suggested that the role of the interest of enterprises. One of the ways to Hong Kong can shift from direct investor to an deliver the information to the industry is by indirect role which could assist in raising organising seminars, to which people from the capital for the OBOR initiative. Importantly, business sectors will be invited to share the the political status of Hong Kong is neutral, prospects of the OBOR initiative. Besides, the meaning that Hong Kong should have a better government can also raise the awareness of the political relationship with other member public towards OBOR. Since OBOR is a long countries of OBOR such as India. Hong Kong term initiative, it needs the support of the can act as a buffer against China and India so as younger generations. The government can to facilitate the economic cooperation between encourage people, especially students, to them. explore the OBOR countries for better understanding of those countries. More schemes similar to the Funding Scheme for 5.2 Risk consideration Exchange in the Belt and Road Countries can First, the currency volatility should be be launched for cultural exchange within considered. The more volatile the currency, the OBOR region higher the risk faced by investors. Investors should be careful about the uncertainty of the exchange rate of the RMB. As for the currency risk of India, the IDR is expected to depreciate against the USD in the coming years. Currency risk would affect the attractiveness of the project and diminish its returns. Additionally, it is recommended to consider the regulatory risks especially in the foreign direct
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Call for Articles for Jan 2017 Issue – Marine Insurance
CY Tung International Centre for Maritime Studies The Maritime Business Insight (formerly “Maritime Insight”) was launched in June 2013 under the CY Tung International Centre for Maritime Studies (ICMS). It aims to combine both theoretical and practical knowledge and promote collaborations among scholars and professionals in the maritime industry. It mainly covers article reviews of general interests to the profession with a special focus on different maritime concerns. We endeavor to summarise current maritime initiatives and to bring forward topics for further discussions in academic research whilst also offering implications to industrial players and policy makers.
Interested parties are cordially invited to submit the practical article in Chinese or English. The article can be 2-6 pages long. For our January 2017 issue, we would like to focus on the topic of Marine Insurance.
Topics will include but not restricted to:-
Hull and Machinery Insurance Shipowners’ Liability Protection and Indemnity Charterers’ Liability Protection and Indemnity Cargo Insurance (Institute Cargo Clause A, B or C) Loss of Hire Insurance Freight, Demurrage and Defence (FDD) War Risks Kidnap and Ransom Insurance (K&R) Crew Personal Injury Insurance Liability Insurance for Specialist and Offshore Support Vessels Average Adjusting (Free of Particular Average (FPA), etc) Loss Prevention
It is MBI’s editorial policy to welcome submissions for consideration which are original. All submissions should not have been published elsewhere and not under consideration for any other publication at the same time. You can provide a short bio (three to five sentences) at the end of the article and you may link to your company, blog and projects. For submission of articles or enquiries, please email to [email protected] on or before 15 December 2016. For enquiries, please call Ms. Vicky Yip at 3400 3617.
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CY Tung International Centre for Maritime Studies
Prof LU Chin-Shan, Director of the ICMS, Dr T.L. YIP, Dr Daniel The delegation of the Education and Training Division of the NG, Dr LUO Meifeng, Dr Hans WANG, and Dr YANG Dong of China Council for the Promotion of International Trade Dept of LMS of PolyU visited Zhejiang University, China on 27-29 visited the ICMS on 9 August 2016. They were received July 2016 to exchange views with academies there on various maritime issues including the OBOR initiative and ship voyage warmly by Dr T.L. YIP (left 1), Dr Anthony PANG (left 8, management problems (SVMP). Prof Hong YAN (centre)and Dr Johnny WAN (right 8) of the Dept of LMS of PolyU.
Professor Manolis KAVUSSANO (middle) of Athens University Professor Nikos NOMIKOS (middle) of Shipping Risk of Greece, an expert in shipping finance, visited the ICMS on 2 Management at Cass Business School, City University of August 2016. He was greeted by Mr. WONG Cho Hor, Director London visited the ICMS on 18 August 2016 and delivered a of Five Oceans Ltd. (left 1), Prof LU Chin-Shan (left 2), Dr Sik talk on shipping index. He was greeted by Prof LU Chin-Shan Kwan TAI of the Dept of LMS cum Editor in Chief of Maritime and Dr T.L. YIP. Business Insight (right 2) and Dr T.L. YIP (right 1).
The opening evening of the Institute of Chartered Shipbrokers (ICS) Hong Kong Branch was held on 8 September 2016.
Email: [email protected] Website: www.icms.polyu.edu.hk,